Higher gold production and a US$38.6-million tax recovery sent Agnico-Eagle Mines’ (AEM-T, AEM-N) net income up 88% to US$54.3 million, or US35¢ per share, in the first quarter of 2009 — up from US$28.9 million, or US20¢ per share, in the year-ago quarter.
Gold production surged 80% year-on-year to 91,810 oz. in the first quarter. And with three new mines scheduled to come on-stream this year and next, Agnico-Eagle believes gold output this year will reach 550,000 to 575,000 oz., rising further to 1.2 million oz. in 2010.
The Lapa mine in northwestern Quebec and the Pinos Altos mine in northern Mexico are on schedule for initial production this year, while the Meadowbank mine in Nunavut, in the Canadian Arctic, will open in the first quarter of 2010.
Total cash costs during the first quarter came in at US$312 per oz., down from minus US$399 per oz. in the first quarter of 2008. Agnico- Eagle forecasts total cash costs for the year to be about US$340 per oz.
The rise in production and total cash costs per ounce in the first quarter were largely due to the startup of Agnico-Eagle’s new Goldex mine, which does not have byproducts, and also because of lower realized prices for byproducts at the LaRonde mine. Both Goldex and LaRonde are in northwestern Quebec.
At the end of March, cash and equivalents increased to US$208.4 million from the Dec. 31, 2008 balance of $99.4 million. Long-term debt is US$415 million at March 31, double the US$200-million debt load the company had in the first quarter of 2008.
Capital expenditures in the quarter totalled US$155 million, including US$46 million at Pinos Altos, US$44 million at Meadowbank, US$28 million at Kittila in northern Finland, US$20 million at Lapa and US$15 million at LaRonde.
At presstime in Toronto, Agnico- Eagle was trading at $57.22 per share. It has a 52-week trading range of $26.60-80.74 and 155.6 million shares outstanding.
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